Payments Industry Stock Price Tracker
Figure 1 is the September Payments Industry Stock Price Tracker. The chart measures current stock prices and market caps (as of September 28th, 2012) as well as movement over the last 30 days, and year-to-date. Most companies across the payments value chain experienced a strong September after mixed results in August and have maintained an average YTD increase of over 25% relative to the broader market’s 13% gain thus far in 2012.
The issuing sector continued to see significant gains in September, edging up 6% on average this month with positive results for nearly every issuer tracked. Gains were felt throughout the sector earlier this month on the heels of increased certainty surrounding European financial markets. The ECB laid out a bond-buying program to give countries extra time to sort out financial matters, while also decreasing the near-term risk of a European breakup. Bank of America and Citi posted double-digit gains this month behind the news, but currently all have ‘hold’ recommendations from analysts. In September, Bank of America joined Discover on the list of issuers who have realized gains of over 50% since January. Discover’s stock hit record highs this past month after the announcement of a new partnership with PayPal, whose recent strong performance has spurred investor confidence.
The processor / acquirer sector posted mixed results in September. Global Payments’ stock price leveled-out this month, despite being down 13% on the year partly driven by a data breach in March that resulted in the compromise of nearly 1.5 million card accounts. Fiserv was the biggest gainer in the processor / acquirer sector over the last 30 days after announcing recent partnerships with Oak Bank and MidFlorida CU. Conversely, Vantiv’s stock price dropped 4% in September with the loss likely attributed to the expiration of its IPO lockup towards the end of the month.
The networks also posted big gains in September; in aggregate, the sector was up 6% from 30 days ago. Visa and MasterCard prices rose earlier this month on the heels of a $7 billion settlement over swipe fees. Network revenue growth is forecast to slow through the end of the year due to uncertainty in global consumer spending.
For more information, please contact Collin Bauer, Analyst specializing in Credit Card Issuing, firstname.lastname@example.org
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